Prescott

Analyze Your Competition

Analyze Your Competition

How it's done

Whether you’re starting a new business or running an established business, it’s essential to analyze your competition. Competitive analysis doesn't have to be complicated. This page gives you a simple process to help identify who your competitors are, where they’re located and some tips to help assess their strength, weaknesses and potential impact on the success of your business. Here are the questions this page will help you answer.

Where are my competitors?

How do I use this information?

The purpose of a competitive analysis is to understand the strengths and weaknesses of your competition and identify opportunities in the market that your business can benefit from. It can also help you to assess what your business does better than most and where improvements are needed. This section provides more information on how to undertake a competitive analysis in your local area.

Identify who your competitors are

The first step in evaluating your competition is to identify all the different types of business that may sell the same, or similar products or services. These may be direct competitors (i.e. similar businesses) or indirect competitors (i.e. businesses offering slightly different products and services, but targeting the same group of customers).

Find your competitors

The second step is to use the mapping tools above to find the name and location of competing businesses in the local area. We’ve identified some of your potential competitors on the map above.

Assess your competitors

The third step is to identify those areas in the municipality that are served by your competitors. Count how many competitors there are in each location – or the location/s you are particularly interested in – then record the name and address of each competitor (you may need it later!). Next up, you want to assess the following characteristics for the area/s which your competitors are located:

customer and workforce demographics

number of people living and working in the surrounding area

access to major roads

proximity to infrastructure and community services

past and anticipated population growth in the surrounding area

Many of these important factors can be assessed by using the activities provided on this website. Further competitor information can also be obtained by undertaking a competitor survey – see below. When assessing each of these factors try to identify commonalities and trends amongst each of your competitors’ locations. This analysis may give you insights into what it takes to create a successful business in your industry. It may also help you uncover opportunities in areas that have the right characteristics but lack significant competition.

Determine the level of competition

An important reason for undertaking a competitor analysis is to identify the level of competition that exists in a location. Three basic levels of competition exist:

competition is excessive and existing businesses are struggling to grow or are in decline

competition is moderate but most of the existing businesses are performing well thanks to strong demand

competition is minimal or does not exist.

Generally speaking, the best locations have moderate competition with strong or growing customer demand. Areas that lack competition can be a huge success but the risk is always higher. So always be wary of locations with little competition – there may be a very good reason for it. Make sure you thoroughly research the possible reasons for the lack of competition, both the obvious and not so obvious reasons.

Bonus tip!

You should not fear competition. In fact, having many of your competitors grouped together can sometimes benefit your business. Locations with clusters of similar businesses attract people on account of their convenience and choice. The best clusters also tend to locate close to other types of businesses that provide complimentary products or services that your customers also need when they visit your business. For example, drug stores and florists often locate near hospitals.

What else do I need to know about my competitors?

While we are providing you with a range of valuable information about competitors, the fact is that all locations and industries are unique. As such, to really understand your local competitors, you should supplement the information we give you with additional local research. Here are some additional things you can do.

Competitor Survey

Continue your analysis by visiting the locations you are most interested in and surveying your competitors. By answering each of the following questions about your competitors you will uncover important success factors that you may wish to replicate in your business. This analysis will also help you uncover opportunities to get ahead of your competition.

What is the name and address of your competitors?

What are their operating hours?

How many customers visit their business on weekdays and weekends?

What do you like about their store or premises?

What don’t you like about their store or premises?

What type of building are they in (e.g. free standing structure; in a shopping centre or mall; downtown street or part of a row of businesses)?

How much parking is available and what is the proximity of parking to business front door?

What is attractive and unattractive about the outside appearance of the business?

What is the condition of the store or premises inside?

What is the approximate square footage of the business floorspace (and lot size if applicable)?

What are the store or premise’s best and worst features?

What are the main types of products or services sold on premises and their pricing?